Housing
Monday, 12 January 2015 17:00

Deuel County No. 1 for Homeownership in SD

Deuel County ranks No. 1 statewide for homeownership with a rate of 85 percent, according to recently updated data from the U.S. Census

Statewide, the homeownership rate was 67.2 percent in 2013 compared to 63.5 percent nationally, both below prerecession rates of 69.2% and 66.6% respectively in 2008. Over the five-year period (2009-2013), the statewide homeownership rate was 68 percent.

Here's a look at the top 5 counties for homeownership: 

 County  Rank  Rate
 Deuel   1st  85%
 Hanson   2nd  83.5%
 Potter   3rd  81.4%
 Aurora   4th  80.6%
 McCook   5th  80.1%

Each of South Dakota's five counties with the lowest rates of homeownership are on an American Indian reservation. 

 County  Rank  Rate
 Buffalo   66th  37.3%
 Todd   65th  46.5%
 Ziebach   64th  51.7%
 Bennett   63rd  52.4%
 Shannon   62nd  52.5%

Statewide, the homeownership rate was 67.2 percent in 2013 compared to 63.5 percent nationally, both below prerecession rates of 69.2% and 66.6% respectively in 2008. Over the five-year period (2009-2013), the statewide homeownership rate was 68 percent.

At the same time, South Dakotans living in non-metro areas were more likely than those in metropolitan and micropolitan areas. 

 Status  Rate (2009-13)
 Non-metropolitan      70.2%
 Metropolitan      68%
 Micropolitan      66.3%

Here's a look at the highest and lowest rates among South Dakota cities from a list of the state's 27 most populous municipalities. 

 City    Rank    Rate
 Harrisburg    1st    83.9%
 Tea    2nd    76.7%
 Dell Rapids   3rd    74.8%
 Hartford   4th    71.8%
 Brandon   5th    71.5%
 Mobridge   23rd    53.6%
 Spearfish   24th    49.4%
 Brookings   25th    47.3%
 Box Elder   26th    46.7%
 Vermillion   27th    43.3%

Homeowners in South Dakota are more likely to be white than of color. The homeownership rate for whites was 71.6 percent (2009-2013), compared to a rate of 36.9 percent for American Indians and 38.2 percent for others of color. Homeownership ranges widely on South Dakota's American Indian reservations, from 68 percent on the Lake Traverse reservation to 30.8 percent on the Crow Creek reservation. 

Find much more data on interactive charts, plus downloadable files and images on the Homeownership page on the South Dakota Dashboard

 

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South Dakotans are often criticized for their dependence on federal dollars. To some extent, this is a matter of perspective. It’s true that for every $1 South Dakotans pay in federal income tax, the state receives $1.16 from the federal government. This “return on taxpayer investment,” however, only ranks South Dakota 24th among the 50 states.

When federal funds are considered as a percentage of total state revenue, South Dakota finishes 49th among the 50 states. In 2013, more than 41.5 percent of the state’s annual budget came from Washington.

Tax credits or “expenditures” aren’t figured into the subsidies a state receives from the federal government, but maybe they should be. One of the largest — the mortgage interest deduction — costs the federal government $69.7 billion a year, according to a new study by the Brookings Institution, an amount that is roughly equivalent to the $73.9 billion budgeted in 2014 for the Supplemental Nutrition Assistance Program for poor families in the United States.

Most of the tax expenditure for the mortgage interest deduction benefits relatively high-income households on the East and West Coasts and in urban areas where real estate prices are comparatively high.

The Brookings study offers an interactive county-by-county map of the average mortgage interest deduction and the share of county residents who claim the deduction. (Remember that only those people who itemize deductions on their tax return can qualify.)

In South Dakota, not surprisingly, the counties with the highest percentage of households who take the mortgage interest deduction are in the Sioux Falls and Rapid City metropolitan areas, although Stanley and Hughes Counties also rank relatively high. The rest of the state, like most of the Great Plains region, has some of the lowest percentages in the country.

With an average mortgage interest deduction of $9,051 in 2013, Lincoln County ranked the highest in the state, followed by Union County at $8,993, Lawrence County at $8,400 and Roberts County at $8,290. Lincoln County also had the greatest percentage of taxpayers who claimed the mortgage interest deduction (28 percent), followed by Union County (21.3 percent).

Access the Brookings Institution’s county-by-county interactive map on mortgage interest deductions or read The Mortgage Interest Deduction Across Zip Codes report from the Urban-Brookings Tax Policy Center.

 

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The housing cost burden in the Sioux Falls metro area is lower than South Dakota's two other metro areas - Rapid City and Sioux City - and is lower than the state as a whole, according to data recently updated by the U.S. Census Bureau. The Rapid City metro area exceeds the statewide average. 

A bit more than 31 percent of households in the Rapid City metro area (Pennington, Meade and Custer counties) were considered burdened by housing costs in 2013, meaning those households pay more than 30 percent of their income for rent or mortgage plus real estate taxes, utilities and other related housing expenses. This compares to rates of 22.4 percent in the Sioux Falls metro area (Lincoln, McCook, Minnehaha, and Turner counties), 23.5 percent for the Sioux City metro area (Union County plus four counties in Iowa and Nebraska) and 24.1 percent for the state of South Dakota as a whole. 

 

More than 73 percent of households statewide earning less than $20,000 per year are burdened by housing costs, while 2.9 percent of households earning more than $75,000 per year are so burdened. For households earning between $20,000 and $35,000, more than 39 percent are burdened. For those earning between $35,000 and $50,000, the rate is more than 19 percent, and it is a bit more than 6 percent for those earning between $50,000 and $75,000. 

Nearly 38 percent of households headed by someone age 24 or younger in South Dakota are burdened by housing costs.  The rate ranges between 22 percent and 25 percent for other age groups. 

For renters, the rate of being burdened by housing costs is more than twice the rate for homeowners, with nearly 40 percent of renters being burdened compared to slightly more than 17 percent for homeowners. 

For many households, the burden of housing costs exceeds 50 percent. In 2013, 9.2 percent of South Dakota households paid more than half their income for housing and related costs. That is the lowest rate since at least 2006. The rate swung between 9.5 percent and 10.5 percent between 2006 and 2012. 

Find more breakdowns for statewide housing cost burden on the South Dakota Dashboard. The interactive charts can be exported in several formats and are free to use.  

At the county level, the top five least burdened counties for housing are all rural. 

No. 1 Lyman County 12.7 %
No. 2 Jackson County 12.8 %
No. 3 Kingsbury County 14.6 %
No. 4 Hyde County 14.7 %
No. 5 Sanborn County 14.7 %

The top five South Dakota counties for highest rate of housing cost burden are either in the Black Hills or home to a university. 

No. 1 Clay County 32.7 %
No.2  Meade County 31.4 %
No. 3 Lawrence County 30.9 %
No. 4 Pennington County 30.4 %
No. 5 Brookings County 29.5 %

Among South Dakota's 27 most populous municipalities, four of the five least burdened cities are in the state's southeastern corner. 

No. 1 Canton 17.3 %
No. 2 North Sioux City 18.5 %
No. 3 Harrisburg 19.1 %
No. 4 Milbank 23.2 %
No. 5 Dell Rapids 23.4 %

The top five South Dakota cities for highest rate of housing cost burden are either in the Black Hills or home to a university.

No. 1 Sturgis 39.1 %
No. 2 Vermillion 37.3 %
No. 3 Hot Springs 35.5 %
No. 4 Spearfish 34.8 %
No. 5 Brookings 33.7 %
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Thursday, 09 May 2013 00:00

Housing Cost Burden

SD Holds onto Nation's 4th Lowest Housing Cost Burden; Disparities Remain

South Dakotans enjoyed the nation's fourth-lowest housing cost burden in 2016, dropping one place from 2015, according to federal data. However, the state’s low-income and young residents still faced substantial housing cost burdens. 

North Dakota was the state with the lowest housing cost burden at 22.5%, while Californians experienced the highest rate at 42.6%. South Dakota’s neighboring states also had relatively low housing cost burdens:

 State National Rank Percent
 North Dakota 22.5
Iowa 3 24.0
South Dakota 4 24.1
Wyoming  7 25.3
Nebraska 8 25.4
 Minnesota 13 26.3
United States N/A 32.4

In 2016, 24.1% of South Dakotans were burdened by housing costs, meaning they paid at least 30% of their income for housing. That means 77.8% of the state's 322,488 households were burdened by the costs of mortgages or rents, real estate taxes, insurance, utilities, fuels, mobile home costs and fees. Housing cost burden rates varied across the state’s metropolitan areas in 2016. In the Sioux Falls metro area (Minnehaha, Lincoln, McCook, and Turner Counties), the housing cost burden rate was 23.5%. By contrast, the housing cost burden rate in the Rapid City metro area (Pennington, Meade and Custer Counties) was 31.2%.

The state hit a recent peak for housing cost burden in 2008, at 26.5%. The Rapid City metro area also peaked in 2008, when it reached 34.9%, while the Sioux Falls metro area's recent high came in 2009 at 28.3%.

Statewide, approximately 10%, or 31,930 households, paid more than 50% of their income for housing in 2016. Prior to 2015, the rate had been dropping from 10.3% in 2010 to 9.2% in 2013.

Nearly 8 out of 10—just over 37,000 total —South Dakota households with incomes below $20,000 are housing cost burdened. Individuals with annual household incomes between $20,000 and $34,999 experienced a housing cost burden rate of 43.4%. South Dakotans earning between $35,000 and $49,000 had a rate of 20.8%, while those earning $50,000-$74,999 landed at 9.8%. Just 2.5% of individuals earning over $75,000 experienced a housing cost burden in 2016.

Across South Dakota, 44.6% of householders age 24 or younger were burdened by housing costs in 2016, while other age groups experienced rates of less than 30%.

The number of housing cost burdened renters in South Dakota has been slowly but steadily climbing since 2006, when 38.6% of renters paid more than 30% of their income toward rent. By 2016, this rate increased to 40.8%. On the flip side, more than twice as many renters were housing cost burdened than were homeowners in 2016, 40.8% versus 16.7%. Unlike renters, the percentage of homeowners who are housing cost burdened has declined in recent years—from 21.5% to 16.7% in 2016.

Published in Housing
Tuesday, 07 May 2013 00:00

Homeownership

South Dakota Homeownership Rate Holds Steady As National Rate Dips

South Dakota's homeownership rate has held steady at roughly 68% in recent years, even through the Great Recession in 2007-09, according to federal data.The national homeownership rate, however, dropped precipitously following the 2007-09 recession, but has stabilized around 63% over the past three years.

According to 2016 homeownership data, 63.1% of United States residents lived in homes they owned compared to 67.2% in South Dakota. The Rushmore State ranked 19th of states across the nation for homeownership last year. West Virginia had the highest rate of homeownership in 2016 at 72.4% while New York had the lowest at 53.3%.

Regionally, Minnesota had the highest rate of homeowners at 71.3%, followed closely by Iowa at 70.3%. Nebraska had the fewest homeowners of states surrounding South Dakota at 65.3%.

With an average homeownership rate of 71.7% from 2011-2015, white South Dakotans were nearly twice as likely to own their homes as Native Americans and Asians, who had homeownership rates under 38%. During that same time period, blacks had the state's lowest homeownership rate, at 24.4%, while Hispanics had a 42.2% homeownership rate.

Homeownership across income levels in South Dakota has fluctuated since 2000. The rate of homeownership for households earning less $20,000 was 10 percentage points lower in 2016 than it was in 2000, and just over two points lower than in 2010. Additionally, the total number of households earning less than $20,000 annually has dropped from 75,652 in 2000 to 52,840 in 2016.

Conversely, the total number of households with incomes between $50,000-$74,999, as well as those earning more than $75,000 increased from 2000 to 2016. The total number of households with incomes over $75,000 rose from 37,424 in 2000 to 114,265 in 2016. The number of households with incomes between $50,000 and $74,999 grew from 53,864 in 2000 to 66,975 in 2016.  The group of households earning more than $75,000 maintained a steady rate of homeownership around 90% during the 2000 to 2016 period. However, the homeownership rate for the $50,000-$74,999 group dropped from 85.5% in 2000 to 72.2% in 2016.

 INCOME LEVEL  2000 RATE 2010 RATE 2016 RATE 
 Below $20,000  44.9% 36.8%  37.8%
$20,000 to $34,999   62.0% 56.8%  50.9%
 $35,000 to $49,999  75.4% 65.1%  60.2%
$50,000 to $74,999  85.5% 81.6%  75.0%
$75,000 or more  90.8% 90.7%  90.9%

The downward trend is not as consistent when homeownership rates are evaluated by age groups. The rate for some age groups ticked up while it ticked down for others. 

 AGE 2000 RATE  2016 RATE 
 24 & younger  17.8%  19.6%
 25-34  53.3%  47.8%
 35-44  72.1%  71.1%
45-54 79.0% 75.4%
55-64 81.6% 77.5%
65-74 80.9% 80.0%
75-84 70.1% 73.4%
85 & older 54.1% 50.6%

When evaluating by household type, married couples with no children were the most likely to own their homes in 2016 while single mothers were the least likely. Here are South Dakota's homeownership rates by household type in 2016: 

  • Married couple with no children – 88.5%
  • Married couple with children – 81.6%
  • Individual living alone – 49.2%
  • Single man with children – 50.1%
  • Single woman with children – 42.1%

 

 

 

Published in Housing
Tuesday, 04 December 2012 00:00

More Households Cost-Burdened Since Recession

A study by the Joint Center for Housing Studies of Harvard University points out that in the wake of the collapse of the housing bubble in 2008, the national rate of homeownership has fallen and the percentage of Americans who are renters has increased.

The Harvard study focused on cities with more than 100,000 people, so the Rapid City metropolitan area (which includes Pennington, Meade, and Custer counties) did not make the list. The South Dakota Dashboard has the relevant data, so we looked at how our region would have fared if we had been included.

Homeownership Versus Renting

In the United States, the rate of homeownership has declined from its peak of 67.3 percent in 2004 to 63.5 percent in 2013. This means nearly 42 million households across the country are renters. In South Dakota, homeownership suffered a more modest decline. From a peak of 69.2 percent in 2006, homeownership fell to 67.2 percent in 2013. The decline was far greater in the Rapid City Metro area falling from a peak of 71.7 percent in 2006 to 65.8 percent in 2012, though it has increased to 68.1 percent in 2013. Sioux Falls also saw a decline (from 69.7 percent in 2006 to 64.6 percent in 2012), although it, too, has increased to 68 percent in 2013.

Unlike the rest of the nation, Rapid City has seen a significant decrease in the share of cost-burdened households since the peak of the recession. In 2008, 34.9 percent of households in the Rapid City metro area were paying 30 percent or more of their income for monthly housing costs. In 2012, that rate fell to 27.1 percent, though it has increased to 31.1 percent in 2013. Sioux Falls shows similar trends with percent of cost-burden housing peaking in 2009 at 28.3 percent but has decreased to 22.4 percent in 2013.

The Harvard study also looked at trends in rental prices in relationship to median household incomes. Nationally, they found that while real median rents increased 6 percent between 2000 and 2012, real median incomes for renters fell 13 percent. In the United States in 2012, according to statistician Ben Engebreth, the median annual rent as a percentage of median household income was about 20.7 percent. In the Rapid City metro area, where the median annual rent was $9,372 (or $781 per month), the ratio of median rent to median income was 18.6 percent in 2012, lower than the nation, but higher than the statewide rate of nearly 16.2 percent.

Governing magazine provides an interactive tool that allows the user to see how cities rank in terms of housing cost burden. According to this tool, Sioux Falls, with a rent-to-income ratio of 27.3 percent ranked 282nd among 302 cities in terms of housing cost burden, making it one of the most affordable major cities in the country for rental housing. If Rapid City had been included in this chart, with its 18.6 percent ratio, it would have beaten all other cities on the list.

To view more statistics on homeownership rates visit the Housing Cost Burden page on the South Dakota Dashboard.

 

Published in South Dakota Dashboard
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